This is a difficult time for the carmaking industry.
Car sales are down. And difficulty obtaining credit has a number of other effects.
Dealers often buy new stock on credit – currently unavailable.
Finance businesses which provide credit to motorists, allowing them to buy cars, face the same difficulties as banks, but have not benefited from the Government bail-out.
And the long and sometimes complicated supply chain in car production makes it vulnerable to the credit crunch.
So it is no surprise the Society of Motor Manufacturers and Traders has asked for money.
It’s important to note, however, this is not a plea for money to bail out a failing business which can only survive with government subsidies. Rather, manufacturers want the Government to step into the breach and provide facilities offered by the banks in normal circumstances, or to make it possible for the banks to lend to them. In other words, they want loans rather than grants, and probably only in the short term.
Alistair Darling, the Chancellor, has said that he will consider the proposals and judge them on their merits.
This is a long way from a definitive answer, but at least it looks as if the plea from the Society of Motor Manufacturers and Traders will get a fair hearing.
With the failures afflicting the financial services sector, there appears to be growing appreciation of the importance of manufacturing among politicians at Westminster. Conservatives, including Tory leader David Cameron, met senior manufacturing figures in the economy yesterday, to discuss what it would take to help them thrive.
Manufacturing continues to play a key role creating wealth across the UK.
